The course weblog for PA5113, State and Local Public Finance, at University of Minnesota

Monday, April 13, 2009

Federal Stimulus and Metro Council

The American Recovery and Reinvestment Act (ARRA) has already been described on this blog as a vast resource for intergovernmental grants. Some of the key initiatives of ARRA are to rebuild infrastructure, create jobs, and invest in transit. In Minnesota, these goals are partially being addressed through new transportation projects.

Minnesota has $1.5 billion planned in transportation spending, not including stimulus projects, and Minnesota has received $600 million in stimulus funds for new road and transit projects. You can see the allocation of stimulus transportation spending and oversight below:

Metro Council is acting as an adviser to MNDOT for metro area roads projects, and is overseeing the selection process for transit investment (p.172-8) in Minneapolis and St. Paul. While the Transit Advisory Board has set forth criteria for transportation spending, Metro Council has identified three key factors that will determine how projects are chosen:

One of the key differences between the TAB and Met Council ideals is item number one of the Met Council criteria- to offset the operating costs. This is due to a $61 million operating deficit. While $69 million is expected for urban transit spending in Minnesota, Metro Council is limited in what they can spend on, and cannot At this point it is too early to determine how the deficit will be offset, but the following projects have been identified as possibilities:

-Replacement buses for Metro Transit and Metro Mobility

-Additional vehicles for the Hiawatha Line to increase capacity

-Additional vehicles for Northstar Commuter Rail

-New Bus garages for bus storage and maintenance

-Park-and-ride expansions

-A bus-only ram on TH169 and Stagecoach Road

While none of these directly address the deficit, it is likely that these were projects that were already planned, and that planned funding for these projects will now be available for other expenses. However, this presents a good case of how the stimulus bill will help the state, but still come short of completely solving some budget issues.

1 comment:

This is great! What interests me most is the three "key factors" for how federal stimulus will be used -- although the money is for capital projects, the goals are set directly related to the solvency of operating budget. This makes lots of sense to me.